Ebay - Turnaround? ..Or Spinning Its Wheels!

"Gala Apples"

Saw this on a blog and got permission to print it here....dem's my feelings exactly:

Whatever happens to Ebay in the months ahead, it will change. Definitely not the turnaround Donahoe wants but it will change or it will die! Simple as that. For over 2 1/2 years he has been promising a turnaround and a big change....that is NOT happening. Ebay has stagnated from quarterly report to quarterly report and now depends heavily on Paypal's success (which also is not forever). At this point about the only hope Ebay has is to oust present management and his team and hire people experienced in online sales and what it takes to make those sales (the latter being the most important). Donahoe relies on Ebay's name and since that isn't working he probably doesn't know which way to turn at this point. The result is nothingness...a stagnation that will kill.

If Ebay were my site I would immediately divide it in the style of Overstock...with the diamond sellers on one side selling retail and the small sellers on the other side selling auctions and BIN's. Its Ebay's only hope and that hope is fading as days go by. Sellers are leaving and other sites ARE getting a foothold - whether Ebay wants to admit that or not!

Ebay needs to bring community and fun back to the auction side. They need to let up on some of those draconian policies that are chasing sellers away. Make it okay for sellers to make a profit selling on the site!

Take the power to destroy sellers out of buyers' hands and make that an administrative decision! Get rid of the childish DSR's and go back to relying on feedback and that percentage figure of negs and neutrals.

Ebay needs to get their hands dirty - get into the trenches and work with buyers and sellers. Time is gone where they could simply sit back and rack in the money....they need to realize this.

Grannygoodpaint:

I have one word for John Donahoe: Rakuten. I think he best work and work fast on a logical turnaround that is built for success and not the quick buck. Rakuten wants world dominance and they are aggressively working on it. Its only a matter of time before they reach out to US buyers...AND...US sellers...! ;-)

My painting for today....Gala Apples - an apple for the teacher?

Rakuten, Inc. - What is Next for Ebay?

"Spring Walk"

I posted this on a UK blog this morning and felt it was good enough to post here on its own. As sellers are hearing the news about the giant Japanese company Rakuten, Inc. buying up Buy.com - they can't help but wonder what this will do to Ebay and its three year destruction path called "disruptive innovation." I'm hoping something great will come of it. What is needed here is stiff competition and I'm hoping Rakuten will become just that. I'm sick to death of hearing the excuses about auctions not being popular or that the economy is to blame. Underneath it all perhaps bad management and the wrong business model are to blame?

My post: I think you’ll find that here in the States we are pretty much for the underdog…the downtrodden. The idea that Ebay was a place where the elderly, the disabled and the stay at home moms could earn some money was worth supporting, and make no mistake auctions are pretty much alive here. Ebay, in the last few years, has managed to kill the excitement of auctions and destroyed the feeling of community that was so alive on the site. They’ve pitted buyers against sellers and driven off some good decent small sellers at the whim of buyers having a bad hair day! Ebay’s reputation is mud here right now.

I feel Ebay would profit from splitting their site – much as Overstock has done. Retail on one side – auctions and fixed price listings on the other. Instead, they try to combine them as Amazon does and its not working. They simply have no skin in that game – they sell nothing but a service and right now they are doing that very badly!

I think Ebay may finally be realizing they can’t make it on retail alone. The competition is stiff, wiley and well-honed. Up against the likes of Amazon they look like what they are – shabby and disorganized. It will be interesting to see what Rakuten will add to this mix. If Ebay does not get back to their roots and their niche as a place where one can find the unique, the rare, the vintage, etc. I believe they will drag on like this for years or until the present management is finally ousted. That’s my take on it after selling on and observing this business for past 12 years.

My painting for today is a watercolor - "Spring Walk"

So What is Your Opinion of this Ebay Post Now?

I've posted this twice in the past - once in 2008 and once last year. I am only going to post part of it - you can find the whole article in June or July 2009. It was taken off an ebay discussion board in 2008. I ask you once again....do you feel it is coming to fruition? What is your opinion on it? For clarification the "tools" mentioned are supposedly Ebay employees."

"The powers that be want to transform eBay into an overstock warehouse venue. A kind of outlet store for the internet much like a cheaper and streamlined version of Amazon. From a strictly business point of view, given the size of eBay and the growing costs of doing business, it makes a certain kind of sense to shift gears. Think about it: when eBay started, sellers were about rare and unique items but here and now the majority of items are common, used counterparts of what can be found new online at retail sites. Truly rare and unique items are sold at real auctions; the “stuff in your attic” isn’t glamorous enough and won’t keep eBay afloat any longer.

The trend away from the rare and unique to the big box retailer is not new. Several years ago the powers that be noticed that the big “powersellers” were simply listing items that existed in their retail stores or inventories. Thus the concept of “buy it now”, “best offer”, and “eBay stores” were created. It was the nascent stage of the plan yet to be. Little by little, without the population noticing, the mechanisms required to replicate the average retail storefront were already in place - and with its rise came the slow, steady downfall of the auction format.

Yet outright pursuit of a retail venue would have led to a major problem that at the time could not have been surmounted. The vast majority of people, on and off line, know eBay as precisely the place for auctions of rare and unique items. The sellers and buyers held onto that perception too but in truth their opinion even involvement in new and improved version of eBay is irrelevant by a certain Machiavellian calculation made by the powers that be. As part of the plan, eBay calculated thus: even if they lost the sellers as part of the change, the buyers will be coming back to buy regardless of who or what operated within the retail-outlet venue.

No, it was the stock holders who the powers that be feared.

Only the stockholders had the power to change the direction set forth by the CEO and the board. So it became imperative to change the equation. Part of the plan is to devalue the stock gradually so that investors merely dumped the stock as opposed to wanting managerial change ala Yahoo. Then to buy back the stock at lower cost and to such a volume that no rebellion against the powers that be were possible.

By the end of July that phase of the plan will be successful and there est of the plan will be revealed without fear of backlash from those who otherwise would have had the power to pull eBay back from the brink.
Indeed, if you believe the current changes are obvious signals that small sellers are not wanted - be prepared - you have seen nothing yet.

So far what have they done? All they have managed to do is silence a seller’s ability to warn others about buyers (half of the purpose behind the original idea of feedback), burden you with higher and higher fees, dangle “treats” like discounts while setting the bar of eligibility so high that the rewards cannot be reached. and, by the way PayPal deals with “complaints” leave you vulnerable to fraud. What if worse was yet to come?

They know if you do not feel safe that you will not use eBay. The changes that have been enacted only eliminates the small sellers. Meanwhile they want to eradicate the mid-sized seller too. And they want to ensure that both do not return.

For the mid-sized seller the DSR became the tool of choice. The powers that be raised the level of what is a good seller artificially high. No manipulation is required; they know exactly the effect of the policy. This is why buyers are told that 4 is a good score and sellers are told that 4.9 yields discounts and higher listing placements. As long as that fractured point of view exists, eBay does not need to interfere with the DSR as has been suggested, the buyers will be killing the sellers naturally.

By August there will be no pretense and the intentions of the new and improved eBay will be clear. The following is only a partial list of the rules that will be imposed. It comes from a memo that circulated within my corner of the managerial department the week before Chicago. I cannot be too specific about certain items and I cannot reveal details of the latest additions without endangering my anonymity.

1. Neutrals will be converted to negatives complete with red icons and reduced feedback scores. Afterward neutrals will not be offered as a choice of feedback.

2. The entire process of feedback will be automated. Buyers and sellers will chose standard feedback from a list. For sellers this operation will be performed automatically upon the buyer winning. For buyers there will be an extra free line with which to add a few comments about the seller without restriction to content. Replies will not be allowed.

3. The implementation of a stricter rules regarding shipping. From the boxes, packing, labels and tapes to where you can buy postage. Orders have been placed for prototypes of “eBay” boxes. UPS and FedEx will be instructed not to accept “eBay” merchandise if it’s not inside “eBay” boxing. They will know, of course, because when sellers buy the “eBay” postage from the “eBay” source, a detailed list of contents with item numbers will be available to the shippers upon scanning a bar code. As for those who continue to use USPS, another level of quality control will be implemented - buyers will be asked, upon confirmation of delivery, if the seller used “eBay” standard shipping items. Naturally, no verification of the buyer’s truthfulness will be attempted, and continued ‘infractions’ will result in suspension. eBay will have other ways to check if a seller is not using the “eBay” equipment - as they will be required to buy at cost the supplies immediately after items are listed. (This is such a large scale operation behind the scenes that I feel comfortable sharing as much of it as I know.)

4. Sales taxes will be included automatically; shipping cost and sales taxes will be used to determined FVF.

5. Item descriptions will be “standardized” with templates which include the posting of a new, universal return policy. Only yearly subscribers to the retail-outlet venue can opt out of these universal return policies but even they cannot alter the template structures being devised.

6. Strikes against buyers will be eliminated as the whole concept of a buyer and bidding will be altered. FVF will be calculated when payment is submitted.

7. Time to Close will be eliminated entirely. Best Match will be the non-alterable default. Best Match is a system that caters to the needs of shoppers not bidders.

8. Placement within Best Match will be determined by several factors, the most important of which will be the extra display features added onto the listing.

9. DSRs can be removed by retailers and powersellers who pay a certain yearly fee.

10. The end play itself which consists of four phases:
a) the main focus shifts to retail sellers whose fees are on a per listing basis
b) stores will be replaced by a classified section, fees will be based on yearly subscriptions and FVFs
c) occasional auctions will be conducted for unique items (celebrity auctions, items that have been featured on the news, etc.)
d) total elimination of auctions for regular sellers.

From the point of view of eBay’s agenda to change gears these alteration make sense. The powers that be want to turn eBay into a retail venue format. Therefore the “buyer” must be changed - bidding and commitments to buy are part of the past. In a retail venue, the item is either in your cart or not and you only commit to buy when you pay at checkout. The seller is also redefined in the way they will be required to do business. They will be forced to copy the methods of retail stores.

The goal is to become Amazon Lite. Unlike Amazon the merchandise will be stocked by the retailers in their warehouses, eBay will be just an electronic centralized venue for outlet sale - a “trusted” name with a wide customer base and popular name recognition.

That is the future and as I write this I know that it cannot be stopped. There are no investors with enough clout and will to challenge the CEO. Stock holders will simply walk away. eBay will not sink, however, it will be exactly in the position its rulers intend it to be at.

Sellers, my advice is simple. You are not wanted. Leave. If you stay, you will be crushed. Leave. Go away. You cannot win.

I am sorry because for too long I have been a complicit tool behind the scenes. I was part of those teams and think tanks that spearheaded many of the “innovations” you know very well and which will be used to destroy you. I know I will not be believed. I will be mocked and ridiculed by the tools and even those who are real, actual people will be hesitant to accept what I have to say. What has been done to this community, the plots and schemes hatched in meetings and across memos, is far, far worse to endure within my soul than any treatment I will receive at the hands of the tools by posting this. You do not know how much they hate you. It is my conscience that I want to clear going forward. Again I apologize. There should have been a better way for the powers that be to effect the change they wanted for eBay - instead they succumbed to cloak and dagger deception."

Ebay...Wha Happened? Amazon...Congrats!!!

Once again Ebay's third quarter report came in with a 29 percent decline in net profit and Amazon's third quarter came in with a 28 percent increase in sales!!! Skype and Paypal are now pretty much holding Ebay up. Mr. Donahoe...how much longer will the madness of disruptive innovation strap Ebay down and beat it up? How much longer will the ridiculous "best match search" be around? Until the last light goes out? You may feel you're changing Ebay's business model but how much revenue and traffic has been lost during this project? Ebay had a monopoly on its niche on the internet - it was the place to go for the rare, the vintage, the collectible you could find nowhere else. That monopoly is now shared with the likes of Bonanzle, eCrater, Etsy, and the like as more and more small sellers leave and take some buyers with them.

The Ebay fiasco seems to be a textbook case in what not to do with a multi-billion dollar company. The sad part in all this are the small sellers - the stay at home moms, the out of work dads, the elderly and the disabled who made real money on Ebay before "the change" started. Many of those small sellers are gone now - pushed out of business by ridiculous new policies - the ones who remain are being treated with suspicion, like crooks and forced to adhere to some pretty draconian policies. From start to finish the new Ebay is a sad joke and each quarterly report verifies that fact. About the only thing that can possibly save Ebay is to split it up into the classic old Ebay where auctions are still king and the small seller is treated like the customers they are - and the new Ebay reserved for the diamond sellers of new chinese junk....but we all know that won't happen.

Mr. Donahoe - sorry, but Ebay can no longer hide behind the economy - not since Amazon's amazing quarterly report. You can no longer say people don't want auctions - they are still popular and fixed price is also available. Traffic is down on your site and buyers are getting rarer and rarer. I beg you to rethink Ebay's path and to once again look at the small sellers who built Ebay and see them as the important customers they truly are.

On the other hand, a company that stuck to its business model, kept its nose to the grindstone and worked hard and honestly to improve its standing on the internet is enjoying a giant leap in stockprices today.

CONGRATULATIONS AMAZON!!!
You're a Class Act!

My artwork for today....a bit of sweetness to go along with the bitter pill ;-)

Ebay Wants to Be Amazon???

"Blue Hydrangea & Sunflowers"
5 X 7" Watercolor

I have a Google Alert on Ebay and throughout the day I get articles and blogs about Ebay - most I delete. I'm only interested in other opinions on the present Ebay and how it is being run. Some of the articles amaze me in how wrong they are about the problems at the world's largest online auction site. Here's my take on it:

Ebay has and is making a big mistake. Donahoe is determined to go toe to toe with amazon and he’s in for a very rude awakening….that awakening has already started only he is too stubborn or uninformed to see it. Amazon built its business model over years of non-profit before it began to make its niche the hard way - thru hard work, determination and a good business plan. Donahoe believes he can bully his sellers into offering some of the same things (customer service, free shipping) that Amazon offers and then Ebay can sit back and rake in the money. He forgets a couple of things. The outraged small sellers are doing a great job of getting the word out about the bully Ebay has become…about its absolutely hostile environment to all but its large diamond sellers and buyers are not only listening they are finding their favorite small sellers elsewhere! Also in Ebay becoming a cheap imitation of Amazon…it is just that….a cheap imitation and nobody likes an imitator! If you want to buy Amazon style why would you go anyplace else but Amazon? Ebay’s niche was in the rare, vintage and unusual items that people could find nowhere else. How foolish they are to kill the very thing that gets people to its site….the very thing that interests people enough to buy on Ebay. Hey…I can get an iPod anyplace (in fact I bought my direct from Apple)….but the 5 milkglass lamps I needed for my vintage chandelier could only be found on Ebay.

The board of directors needs to wise up and fast. They need proper management…management schooled in the hard knocks of online selling. Otherwise, after this next drastic decline in quarter sales they will finally see that Ebay is on the path to destruction! Its rapidly becoming too late for Ebay to survive

My painting for today is something bright and cheerful to hopefully warm up the rest of the country. Take heart...Spring is next month.

Ebay's 4 Percent Drop in Site Visits - What Does it Indicate?

2 1/2 X 3 1/2" painting of Hamburger and Fries
Perhaps we can call it "Where's the Beef?"

I'm very surprised that only a 4 percent drop in site visits has been reported for Ebay! This does not, however, tell the story of their sell-thru rate during the same period and I've seen nothing on that. For the past year sellers have been complaining that they cannot sell in the present environment on Ebay. Many of them packed up and left because they were hidden by the faulty best match search and they were up to their necks in outrageous policies and fees. So, it continues as Ebay management plods along on the maniacle path to remaking Ebay over into a cheap and cheesy Amazon clone! Ebay feels that's where the money is and where their future lies. Ebay management does not see the years and years of hard and honest labor Amazon put into its business...they sees only Amazon's profit and they want it! How dreadful for a once loved company like Ebay to come to this point. How tragic to put thousands of small business owners - the elderly, the disabled, the stay at home moms the out of work dads who all depended on Ebay - out of business! A year ago Ebay only needed tweaking to bring some of the original excitement back - now it is faced with doom and still their CEO and his "team" plod on towards the edge of that cliff!

The very heart of Ebay has been destroyed. The small sellers of the vintage, unique and rare items that drove buyers to the site are leaving in droves. It has now reached a point where buyers complain they cannot find their favorite sellers...yet Ebay management plods on...far better to make Ebay into yet another black and white catalog store like so many others online who do the job far far better! If the present management team isn't changed soon there will be no turning back for Ebay there will be a very small future for the company as opposed to their very big and hearty past! I believe we're watching the destruction of a once healthy and wealthy company!

My painting for today is an ACEO of Hamburger & Fries. Perhaps we should call it "Where's the Beef?"

Ebay Loses Traffic This Holiday Season!

"The Snowman's Tree"

Sadly, this is almost an "I told you so" but knowing the thousands of good small sellers that Ebay's new attitude has put out of business is way too sad for sneering and saying I told you so.

I think John Donahoe is learning a hard lesson: all the "noise" he heard when he took office was the sound of good business that he infuriated thanks to his outrageous new policies. Donahoe's idea is to destroy a working business model and turn Ebay into an online catalog store - hence the "diamond sellers" he has ushered in and given free or reduced listing fees to peddle their dropshipped junk. He's strangled small sellers to the point where they simply found the site unmanagable and unprofitable and they left...(a LOT of them are flocking to bonanzle.com). I'm sure the fact that most, if not all, of the sellers who left also BOUGHT on Ebay...is giving Donahoe nightmares because he seemed completely oblivious to losing sales when you lose sellers - any CEO with strong Ebay sales experience probably could have warned him.

Donahoe can't seem to understand people don't want....nor do they NEED yet another catalog store online. Amazon fills that bill nicely and every major retailer now has online presence and does it far better then Ebay ever could! What's left? The "noise" Donahoe kicked to the curb! I believe he's slowly learning the site is definitely going to tank without the small sellers who brought their unique, rare and vintage items to the site...THIS is what people want and NEED! Its deceptively simply, John!

An example....I have a white milkglass chandelier that was here when I bought my home. Two of the milkglass shades were broken but I loved the light and so tried to hide the broken shades. The chandelier is probably 40+ years old so you won't find these shades in any store. I've been searching on Ebay and finally found a set of 5 of these exact milkglass shades for the incredible price of only $6.00. I bought them and they are perfect!!! I wanted a large corning teapot that isn't even made anymore...got it on Ebay and love it!! THIS IS WHAT PEOPLE WANT FROM EBAY JOHN!!!! When I bought a new vacuum - I bought it online from Walmart! When I bought a new external hard drive I bought it from Amazon because I knew they would stand behind it. I buy none of these catalog things on Ebay! GET A CLUE JOHN!! WAKE UP BECAUSE THE SHIP IS SINKING AND ITS YOUR FAULT!

After New Year Ebay will be up against far more formidable opponents then Amazon. All the major retailers will layoff workers - streamline and then put on the most stunning sales ever seen in an effort to do enough business to stay afloat and weather our faltering economy! Ebay will be NO match. An example I heard only today is a local furniture store offering $600.00 in gas and $500 in free groceries if you buy a big screen TV from them! Ebay...whatcha gonna do? You're going to tank even faster in the face of competition like this.

So, I humbly suggest....get rid of best match!!! Nobody - not even the buyers - want it. Loosen up the stranglehold on small sellers and let them do what they pay Ebay to do....SELL!! Stop allowing every nutcase buyer that wanders in to destroy seller reputations while giving the sellers NO recourse! Get rid of most of the draconian policies you put in place this year and do it before the economy sinks even farther - which I feel will be mid-January, 2009. If you don't - your company is doomed! This is something sellers have been warning about ALL YEAR and now finally EVERYONE else can SEE it! Wake up!

My painting today is a little ACEO called "The Snowman's Tree"

Ebay - I Can't Believe My Eyes!

A group of major discounters, including eBay Inc. and Costco Wholesale Corp., is expected Thursday to call for new laws blocking manufacturers from setting minimum prices on their wares.

Ebay is working with the American Antitrust Institute trying to stop manufacturers who use map (minimum advertised price) from protecting their brands. That may seem a noble thing to do and I have no immediate opinion on that - BUT Ebay is doing it by trotting out the plight of small sellers and how THEY would be hurt by BIG RETAILERS if this ruling were upheld!!! My mouth dropped as I watched this VIDEO

Watch the video then give me your thoughts on this. I know my thoughts are those of outrage!